Leaseplan India Pvt. Ltd. vs Topsgrup Services Ltd.

Prathiba M. Singh, J

Advance copy is stated to have been served to the ld. counsel for the Respondent both by post and email. However, none appears for the

Respondent.

The present petition raises an important issue as to whether automatic notice can be issued in petitions under Section 34 of the Arbitration &

Conciliation Act, 1996 (hereinafter “Actâ€), in the manner as has been done by the Trial Court vide orders dated 12th December, 2019 and 24th

January, 2020.

The submission of Mr. Paritosh Budhiraja, ld. counsel for the Petitioner is that the Arbitral Award was passed and communicated to the parties on

12/13th September, 2018. The first filing before the Delhi High Court was on 5th January, 2019, which was beyond the three months’ period but

within the 30 days’ extended period. However, the Registry raised various objections on 7th January, 2019. The Respondent did not take any steps

thereafter. The Petitioner then issued a statutory notice under the Insolvency and Bankruptcy Code to the Respondents and also filed an application

before the NCLT, Mumbai on 16th October, 2019. In reply to the said notice on 30th October, 2019, the Respondent claimed that it had filed an

application under Section 34 of the Act. However, on 19th November, 2019, after passing of 10 months, the refiling of the said petition was done by

the Respondent in the Delhi High Court. On 20th November, 2019, the Registry again returned the petition under objections. On 7th December, 2019

refiling of the said petition was done again in the Delhi High Court.

Thereafter, the Respondent filed a fresh petition before the Commercial Court, Saket Courts under Section 34. On 12th December, 2019 the

following order is passed:

“Fresh petition U/s 34 of Arbitration and Conciliation Act, 1996 received by way of assignment.

It be checked and registered.

Present: Sh. P.S. Sridhar Raj, Ld. counsel for petitioner

Heard. File perused.

At this stage, no ground for stay is made out, without hearing the other side.

Let notice of the petition be issued to defendant on filing of PF/RC and Speed Post, within seven days. Put up for further proceedings on

24.01.2020.

Copy of this order be given dasti to the Ld. counsel for plaintiff as prayed for.â€​

On 16th January, 2020, without examining the issue as to whether the delay in filing can be condoned and without considering the application under

Section 14 of the Limitation Act, notice has been issued in the main petition itself and Reply has been called. Ld. Counsel for the Petitioner submits

that issuance of notice in the said petition, is seriously prejudicing the Petitioner’s case before the NCLT, Mumbai as it is being argued by the

Respondent that there is a pending dispute and the award has not yet attained finality.

A perusal of the orders dated 12th December, 2019 and 24th January, 2020 clearly shows that the Trial Court has not considered the applications

for condonation of delay and under Section 14 of the Limitation Act, which ought to have been considered prior to issuance of notice in the main

petition under Section 34. Notice in a petition under Section 34 is not automatic. The Court has to examine as to whether any of the grounds under

Section 34 are even made out. Prior to the same, limitation is also to be considered, as the period for filing a challenge to the award is mandatory.

Issue notice to the Respondent. In addition, counsel appearing for the Respondent in the Trial Court be also served. In the meantime, there shall be

stay of the impugned orders dated 12th December, 2019 and 24th January, 2020. The Trial Court may, however, hear the applications seeking

condonation of delay and Section 14 of the Limitation Act and only call for replies in respect thereof. The Trial Court may decide the said applications

and thereafter consider the question of issuance in the petition under Section 34, if the need arises.

List on 20th May, 2020.

Order dasti under signature of the Court Master.